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payments, to be made the first of each month, beginning September
1, 2000, specified in Surgicoe’s promissory note to Ms. Moore.18
Therefore, it is clear that petitioners reported, on their 2000
return, no more than the cash payments received in 2000, not the
full amount of the selling price for Ms. Moore’s LLC membership
interest ($1,138,806.12) and not the full face amount of the
Surgicoe promissory note ($160,825.87). Under those
circumstances we find that petitioners did not elect out of the
installment method of reporting the income from Surgicoe’s
promissory note. See Estate of Wilkinson v. Commissioner, T.C.
Memo. 1993-463 (“The only method for electing out of the
installment method * * * is for taxpayers to report the full
amount of the sales price and the full amount of the income
associated with installment sales on timely filed tax returns for
the year of the sales.”).19
18 Assuming the monthly payments commenced on Sept. 1,
2000, as specified in Surgicoe’s promissory note, the fifth
payment would have been due Jan. 1, 2001. It appears, however,
that that payment was included in petitioners’ 2000 return.
19 Respondent cites petitioners’ failure to file a Form
6252, Installment Sale Income, as conclusive evidence that
“petitioners have not demonstrated that they intended to report
their transaction under the installment method.” Respondent does
not suggest that petitioners’ failure to file that form
constituted a procedural defect sufficient in itself to bar
petitioners’ use of the installment method, and, indeed, there is
no support in either sec. 453 or the regulations thereunder for
that position. As we conclude herein, it is a taxpayer’s
reporting of the full amount of the income derived from an
installment sale (not the taxpayer’s failure to file a Form 6252)
(continued...)
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